Many traditional homes in Pittsburgh’s East Liberty were neglected and used for crime.
Photograph: Ben Filio

Dorothea Burke is standing in the street, staring at her house. It’s a warm day in late May and after a hard Pittsburgh winter, Burke and many of her neighbours are in home improvement mode. Drills and power saws blare in the background. New windows are going in across the street and the house next to it is on the market. Facing her house, Burke, a 23-year resident of this block, is thinking about repointing her brickwork and maybe a paint job. “People are finally taking pride in their homes,” she says.

For this neighbourhood, East Liberty, once one of the city’s most dangerous and crime-ridden, the air of optimism and reinvestment is a stark contrast to darker days in the recent past.

“It wasn’t peaceful before,” Burke says. A few years ago, two teenagers tried to rob an older neighbour who protected himself by shooting them both dead. From her balcony, she would watch police lights flashing on a problem house at the corner – sometimes after gunshots, but mostly for drugs. “It was almost a weekly thing,” she recalls. Then, a couple years ago, the property got new management, she says, and the cops stopped coming.

To many here who lived through years or decades of instability, it seems the entire neighbourhood is under new management. Crime is down. Vacant lots and abandoned homes are being redeveloped. Property values are rising. The streets are feeling safe and calm.

They were the worst public housing projects in the region and they were anchoring our neighbourhood

New mixed-income housing is sprinkled throughout East Liberty. Photograph: Ben Filio

Much of this transition is the work of East Liberty Development Inc, a community development corporation that has systematically bought abandoned homes and criminal hotspots, bought out slumlords throughout the 400-acre neighbourhood and redeveloped the properties into stable, well-managed, affordable and market-rate housing. “We took on a huge risk,” says Kendall Pelling, ELDI’s director of land recycling. “We owned the 250 worst properties in a blighted neighbourhood and we’d borrowed most of the money to get them.” But the risk paid off: violent crime dropped roughly in half, and, for the first time in decades, homebuyers are looking at East Liberty as a place to live.

It’s a long awaited rebirth. In the early 20th century, the neighbourhood was a thriving commercial district that many called the second downtown of a city made prosperous by the steel and glass industries. But a 1960s urban renewal project drained much of the neighbourhood’s vitality and concentrated its poverty in large public housing projects. One of those towers literally rose up and straddled the area’s main thoroughfare, creating an intimidating gateway to the neighbourhood. “People would throw stuff out of their windows at you when you drove through,” recalls ELDI executive director Maelene Myers, who has been with the organisation since 1996. “They were the worst public housing projects in the region and they were anchoring our neighbourhood,” says Pelling. East Liberty became a neighbourhood to avoid.

Decades of cyclical poverty and disinvestment ensued. Deindustrialisation more than halved the city’s peak population of 676,000 in 1950. Then, in 1999, a community plan was drafted to reshape East Liberty. The big public housing projects were demolished and replaced with mid- and low-rise, mixed use and mixed income developments. New commercial development was encouraged. In 2002, a Whole Foods grocery store opened. An Ace Hotel is in the works. Things started to change, if slowly.

Construction central … A closed bank is torn down to make way for affordable housing. Photograph: Ben Filio

But on its residential streets, long-term problems persisted. Blocks littered with abandoned homes and vacant lots became magnets for crime. Property values hovered around $50,000 – low for the city – but most of those homes needed at least that much in renovations and repairs, so many sat and continued to decay.

ELDI began buying empty lots and abandoned or foreclosed homes and making the piecemeal investments to turn them into quality homes. But the scale of the problem was huge. “The standard community development approach was woefully inadequate,” says Pelling. “We had 80 abandoned houses in the neighbourhood. Doing two or three of them wasn’t going to change the market.”

Around the corner is a building ELDI bought after the US Marshals seized it from a major cocaine distributor

As a non-profit developer embedded in the community, ELDI met regularly with residents to hear their concerns and ideas. When talk inevitably turned to crime, a recurrent worry was slumlords – hands-off landlords who had, through neglect, allowed their properties to be used for criminal activities. Drugs, prostitution and violence were common, and though their negative impacts spread across East Liberty, the sources were a relatively small amount of buildings. “All the neighbours knew exactly who was dealing. They know who his grandmother is. But the police have to build a case for that and it’s a slow process,” Pelling says of the slumlord-crime connection. “We knew it, but it scared the hell out of us.”

In 2003, ELDI decided that the only way to stop that problem was to remove the slumlords. “It doesn’t matter if it’s a 14-storey tower with no management and bad conditions or a 3-storey house with no management and bad conditions, it’s the same damn thing,” says Eric Jester, who worked with Pelling to spearhead the slumlord buyout program but who has since left ELDI. By 2007, ELDI developed a viable financial model to begin a large-scale buyout of some of the slumlords many neighbours had complained about for years. One of its first major buyouts – an $8.2m project – turned a scattered group of decaying buildings and empty lots into 41 units of mixed income housing.

Walking through the neighbourhood recently, Pelling points out some of the properties ELDI has acquired – homes where people had been murdered and prostitution thrived. He passes an apartment building where the hallways were basically 24-hour drug markets. Around the corner is a building they bought after the US Marshals service seized it from a major cocaine distributor. “I still have a full 9mm clip that fell out of the drop ceiling,” Pelling says. “It’s my paper weight.”

Large buildings play host to a number of mixed income and affordable housing units. Photograph: Ben Filio

Through its targeted slumlord buyout program, ELDI bought up more than 200 housing units in the neighbourhood, about 3% of the total housing stock. They contracted a property manager to screen and remove problematic tenants. For the most troubled properties, off-duty police officers were hired to make random patrols. Based on neighbourhood feedback, a few properties have been redeveloped as supportive housing, one for women in recovery and another for chronically homeless men. One row of houses has developed into a co-housing community, with a big shared garden.

While still at ELDI, Jester made a personal bet on East Liberty. In the mid 2000s, he bought a home in its most active crime hotspot – “the worst end of the worst block,” he says. But over the years, ELDI has gradually bought and redeveloped many homes on this problem block, and Jester has watched as the crime has nearly disappeared. To see if numbers would support his observations, Jester pulled crime statistics and had a map made to show how the incidence of crime changed. On his block, a former red blotch of repeated crimes and arrests, the incidence of crime dropped significantly in just a few years.

ELDI was cooling East Liberty’s criminal hotspots through real estate development. To better understand why, ELDI commissioned a study from Pittsburgh-based consultants Numeritics, which tracked the incidence of crime against the locations of ELDI’s interventions.

The correlations were clear: where ELDI invested and rehabilitated properties, the crime gradually decreased. Between 2008 and 2012, serious crimes against persons – aggravated assault, homicide, rape and robbery – decreased by 54% in East Liberty’s residential areas. Total crime – including property crimes and crimes reported in the commercial center of East Liberty – dropped from 221 crimes per thousand residents in 2008 to 164 crimes per thousand residents in 2012.

A set of newly refurbished duplexes in East Liberty. Photograph: Ben Filio

“The idea that community development is a mechanism to address crime is not new at all. It’s just demonstrated vividly in this case,” says Alex Schwartz, a professor of urban policy at the New School in New York and an expert in community development. “There are various reasons for investing in housing and engaging in housing revitalisation. Part of it is providing more affordable housing, but it’s also to remove blight or address other neighbourhood problems. So this is an example of some of these other ancillary benefits of community development.”

Change is underway. Walking through East Liberty, there’s hardly a block without at least one home on the market and others undergoing renovations. Trucks with construction materials rumble down streets and stacks of two-by-fours sit on the sidewalks. More white families are moving into what has long been a predominantly black neighbourhood. A teenage couple walks hand in hand after school, and a group of boys on bikes gathers near a corner. Down the block, a few slightly older males snicker as they walk in the late afternoon sun, holding cans of malt liquor. The grit of a tough neighbourhood hasn’t completely disappeared.

Justin Cummings, a real estate agent who’s lived in the neighbourhood for about nine years, says things have been improving. He recently bought two houses side by side – one for his family and one to rent. As he waters plants in his large backyard, he points across the street to a house where someone had been murdered a few years ago, and to a place around the corner where a crack dealer was recently arrested. But in the near-decade he’s lived in East Liberty, he’s seen the incidence and concentration of crime drop. “It was block by block five years ago,” he says. “Now it’s house by house.”

The idea that community development is a mechanism to address crime is not new. It’s just demonstrated vividly here

The whole East Liberty area is getting a makeover. This multi-use space will include a mass transit station. Photograph: Ben Filio

A few streets over, Dee Peters is tending to her modest front garden. A 13-year resident, she says things have calmed in recent years, but still flare up, especially during summer. She’s noticed the work of ELDI, but says it’s up to residents to create more systemic change. “When things go wrong, we’re the ones calling the police because we’re the ones that live here. They don’t,” she says.

Some worry that ELDI’s interventions may lead to wealthier people displacing the neighbourhood’s poorer residents. Pelling argues that’s unlikely, as most of the housing ELDI has developed or renovated is permanent affordable housing for people with low incomes. “You can’t have a gentrifying neighbourhood where 38% of the units are subsidised affordable rentals,” he says. “It’s impossible.”

But it’s clear that this approach has led to some inevitable displacement. The property managers contracted by ELDI can essentially blacklist problem tenants from renting in any of their controlled properties. During a tour of the neighbourhood, Pelling is approached by one such former tenant, clearly down on her luck, inquiring about any openings. He tells her no, there isn’t anything available right now, but she suspects that’s not the full truth. “Did I do something wrong?” she asks, over and over. Pelling eventually concedes: because of the problems she’d caused in the past, the property manager doesn’t want to rent to her. Pelling tells her he’ll see what he can do, but the situation is unlikely to change. ELDI’s approach to reducing the incidence of crime relies squarely on removing those individuals who cause or enable that crime.

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Since 2002, ELDI has acquired and stabilised more than 500 rental units, which accounts for 20% of the neighbourhood’s rental stock. Though the transformation from East Liberty’s past is by no means comprehensive, ELDI’s intervention in the neighbourhood has been uniquely strategic, according to Stefani Danes, a research associate at the Remaking Cities Institute at Carnegie Mellon university in Pittsburgh. “They recognised that their resources are very limited, so they made a deliberate decision to focus resources where they would make the biggest difference,” she says. But she also notes that the shortage of funding has limited this approach. She’s tracked the impacts of ELDI’s work and has noticed that blocks with more buyouts have fared much better than those with just a few. One, the 700 block of Collins Street, she says, is still deteriorating. “The investment that was made in a couple of properties hasn’t turned it around and those properties are now vulnerable to more deterioration. That’s the risk when you spread your investment around in many different blocks.”

ELDI has relied on low-interest loans from local banks and the support of foundations to be able to acquire these properties. A city programme enables ELDI to buy abandoned homes for only a few thousand dollars, but those still need upwards of $100,000 in work. ELDI is heavily reliant on receiving tax credits for the creation of low-income housing, but those don’t always come through. Through a homeowner programme, ELDI sells some renovated homes at both affordable and market rates to help subsidise its work on the riskier projects that are less likely to break even. More than 100 units have been built or renovated for sale, at an investment of more than $25m.

Funding remains a challenge, which has been frustrating for Pelling. But he’s hoping the crime reduction numbers they’ve helped produce will encourage institutional lenders to ease their lending restrictions and the city to offer more generous tax credits to help ELDI expand this effort.